Foreign Secretary Masud Bin Momen on Sunday expressed concern about the potential repercussions for the country's lifeblood garment industry if it meets with any US restrictions over labour rights issues.
Referring to the recent US presidential memorandum on labour rights, he said, "The memorandum has created apprehension in our apparel industry due to the possibility of restrictions on entry to the US market."
At a seminar in Dhaka, he said that "negative consequences could extend beyond the US, impacting sourcing of raw materials and exports to other countries. Significant progress made in improving worker conditions in Bangladesh could also be hampered if such restrictions are applied."
The seminar, titled 'Global Economic Slowdown, Bangladesh's Apparel Industry and Decent Work', was organised by the Bangladesh Institute of International and Strategic Studies (BIIS).
BIIS Director General Md Abu Bakar Siddique Khan delivered the welcome address, while its Chairman AFM Gousal Azam Sarker presided over the seminar.
The US memorandum, signed by President Biden on November 16, 2023, pledges to uphold worker empowerment and high labour standards globally.
US Secretary of State Antony Blinken warned of potential sanctions, trade embargoes and visa bans for individuals who violate labour rights or harm activists.
Following the announcement, the Bangladesh Embassy in Washington voiced concerns in a letter to the commerce secretary, interpreting the memorandum as a "signal" of potential action against Bangladesh.
Momen urged all stakeholders, including entrepreneurs, buyers, development partners and importing countries, to collaborate in overcoming challenges and ensuring the industry's sustainability and worker well-being.
"With active support from the US, EU, ILO and other UN agencies, we can chart a path towards a more robust and sustainable future for Bangladesh's apparel industry and its workforce," he said.
Speakers at the seminar raised questions about the $12 billion discrepancy between export earnings data reported by the Export Promotion Bureau (EPB) and Bangladesh Bank.
Professor Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, pointed to the widening gap and urged policymakers to address the issue.
"The difference between the EPB and the Bangladesh Bank figures has been growing yearly, reaching $12 billion last fiscal year compared to just $2 billion a few years ago," he said.
He called for "zero tolerance" towards capital flight and non-repatriation of export earnings, suggesting these could be factors behind the discrepancy.
Mr Rahman said, "A $12 billion gap means Bangladesh has exported $55 billion as per EPB data, but only received $43 billion according to central bank data."
Explanations offered for the gap, such as discounts, cancelled orders and double counting, were deemed insufficient by Mr Rahman. "This needs serious attention," he insisted.
Professor Rahman further argued that while global factors influence Bangladesh's economic challenges, domestic policy lapses also play a role. "Many of the difficulties arise from a lack of adapting the right policies at the right time," he said.
Dr Mashiur Rahman, former economic advisor to the Prime Minister, also addressed the seminar as the chief guest.
He said that the EPB's data relies on customs records based on shipped goods, while Bangladesh Bank's data reflects actual receipts.
He admitted the potential discrepancy between the two methods but ultimately considered Bangladesh Bank's data more reliable and recommended further investigation into the differences.
Turning to the US presidential memorandum on labour rights, Dr Mashiur Rahman acknowledged concerns that Bangladesh's labour and human rights commitments could impact exports and the economy.
However, he pointed to Bangladesh's position as a low-cost supplier of ready-made garments (RMG) to the US and EU markets, suggesting a swift shift in production away from Bangladesh would be unlikely.
"They cannot immediately switch their production from Bangladesh to other countries," he said.
Diversification of exports remained a dilemma over the years and the government has taken the initiative to break the barrier, said Senior Commerce Secretary Tapan Kanti Ghosh.
He said Bangladesh's apparel sector has successfully secured its hold in new markets in Australia, Japan and South Korea.
Labor Secretary Ehsan-E-Elahi said improvement in legal frameworks is the precondition for ensuring labour rights. He noted Bangladesh's ratification of international labour conventions and ongoing amendments to its labour law, aligning with International Labour Organisation requirements.
In his keynote presentation, BIIS Research Director Dr Mahfuz Kabir elaborated on the mounting economic and development challenges facing Bangladesh.
He cited the cascading effects of the Covid pandemic, the Russia-Ukraine war and the resulting disruptions to global supply chains and energy crises.
To navigate these cost-escalating challenges, Dr Kabir advocated for ethical buying practices and increased sectoral diversification.
He linked cost increases to factors like currency depreciation and rising prices of imported and local inputs.
In his speech, BGMEA President Faruque Hassan focused on geopolitical tensions and the pandemic's lasting impact as key contributors to the global economic slowdown affecting apparel sector growth.
BKMEA Vice President Akhter Hossain identified low worker productivity as a major concern requiring practical solutions.
MCCI President Kamran T Rahman advocated for a comprehensive strategy to address both the depreciating local currency and dwindling foreign reserves.
He echoed the call for export diversification as a crucial tool to face potential challenges arising from Bangladesh's graduation from least developed country status and the evolving geopolitical landscape.
munni_fe@yahoo.com